Markets - Rising steel plate prices helped boost ship recycling rates

Mar 09 2018


The excitement being generated by an imminent Pakistani reopening for tankers, coupled with soaring steel plate prices, led to an unexpected market lift last week.

This was particularly true in a previously dormant Bangladesh, which started to acquire fresh tanker units at a dizzying rate, GMS reported.

 

This unexpected and sudden buoyancy from Chittagong was driven by a short and sharp spike in plate prices, which is not expected to last very long, whilst Pakistan’s expected reopening for tankers will probably deprive its competing neighbours of some of their regular diet of wet units.

 

Meanwhile, there were several more privately concluded VLCC deals last week, taking the total number sold to well over 15 within the first two months of this year. In addition, sales of both Suezmaxes and Aframaxes were also reported, in what was another bumper week of wet sales to add to the extremely busy year witnessed thus far.

 

A Pakistan tanker re-opening - the order for which has been rumoured to be forthcoming some time this week and will include ‘gas free for hot works’ certificates from the last port of call - is set to ease some of the pressure on Bangladesh and India who have been struggling to take in some of these recently bullish tanker sales. Prices should also be boosted as a result.

 

The various holiday periods and TradeWinds recycling conference in Hamburg this week has taken some of the major players out of the market, GMS said.

 

Meanwhile in rather a strange move, on Monday, the lobbyist NGO Shipbreaking Platform withdrew from the TradeWinds forum. This was in response to a letter from GMS threatening to sue, unless the Platform removes all mention of GMS from its website, the NGO said.

 

Surely the best place to have a constructive argument is at forums like this, where other interests can have their say- Ed.

 

Danish Shipping said this week that the ship recycling industry is facing a decisive year, as the EU's so-called white list of approved recycling facilities is being formulated. The list is due to be published at the turn of the year.

 

The EU's white list of approved recycling facilities will be in focus in the coming period, as the EC has announced two new versions of the list last March and in the autumn, respectively.

 

The current list does not provide the sufficient recycling capacity and should include the best Indian yards to support the positive development in Alang, Danish Shipping stressed.

 

"It is crucial to maintain the positive development in a country like India, where a substantial part of the world fleet is recycled every year. In this context, the EU's white list can be a great tool and act as a positive incentive. In addition to this, the current list has the practical problem that the capacity is insufficient,” said Maria Skipper Schwenn, Danish Shipping’s executive director.

 

"It is clear that the EU list is currently completely insufficient and that including yards outside the EU is a necessity. The European - including Danish – recycling facilities will be busy with small ships and in particular with obsolete drilling rigs from the North Sea, so they will not be challenged by this.

 

“For the big merchant ships it is crucial that they can be recycled at the best steel price without compromising on environment and safety," she added.

 

Some 22 yards outside the EU have requested to be included on the EU white list. This applies, inter alia, to a number of yards in Alang, and the process of assessing them is in progress, according to the EC.

 

Brokers have reported that the 2000-built VLCC ‘Greek Warrior’ was committed for recycling at an unknown price level on the basis of ‘as is’ Khor Fakkan and ‘gas free for man entry’.

 

Chinese recyclers were said to have taken the 1998-built MR ‘Fowairat’, while Bangladesh interests were believed to have agreed to purchase the 1998-built Aframax ‘Pacific Sunrise’ for a high $495 per ldt. However, this deal includes 1,300 tonnes of fuel ROB, plus 300 tonnes of MGO.

 



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Sept 2018

SMM - scrubbers - coatings - drones - ethane powered tankers - MEG4 - contaminated fuel oil